Show them the money: Federal executives get raises that Phoenix can’t pay … yet

The Trudeau government is giving new and promoted executives job offers at salaries that the besieged Phoenix payroll system can’t yet pay.

The Office of the Chief Human Resources Officer (OCHRO) has notified departments that they can give letters of offer to new and promoted executives at higher salaries, which reflect the six-per-cent raises the government approved in June. They won’t, however, be in line for those increases until Phoenix is able to process the new salary ranges.

About half of the 6,500 executive jobs in government are in an entry level category known as EX-1.

Executives are among the last employees to receive raises, going back to 2014, but Treasury Board made clear they won’t receive the extra pay until the fickle Phoenix system processes all the raises and back pay owed to unionized employees.

And it’s anyone’s guess when Phoenix will have implemented all the transactions created by 27 collective agreements for unionized employees. That means executives can get in the Phoenix queue for their raises.

OCHRO told departments that executives will receive lump-sum retroactive payments to cover the increases at that time.

“We have no certainty when this will be implemented other than it will only be done once the collective agreements are in place,” said Michel Vermette, chief executive officer of the Association of Professional Executives of the Public Service of Canada (APEX), which represents executives

Executives received a six-per-cent salary increase over four years, which essentially matches the basic settlement negotiated with the 18 federal unions over the past several years. Deputy ministers and other heads of agencies are in line for the same increase.

Under the deal, executives will receive .75 per cent increase for 2015 and 2016 and 1.25 per cent in each of the next two years. They will also get an additional “wage adjustment” top-up for 2016-17

Many had hoped the raises could be implemented by late fall, but neither Public Services and Procurement Canada, the pay master, nor Treasury Board, the employer, is setting a target date for when Phoenix will be finished processing unionized employees.

In fact, Treasury Board told the largest union, the Public Service Alliance of Canada, that it won’t know for sure whether its members have been paid the raises and back pay owed to them under the latest collective agreement until June 2019.

“The adjustments to the salaries of executives and other senior leaders will be processed only after salary adjustments for represented public service employees have been processed, said Treasury Board spokesman Martin Potvin in an email.

“Further information on timing for the processing of increases to the base pay for senior levels will be communicated in due course,” he said.

The executive cadre has up to a 10 per cent turnover every year primarily because of retirements, which are filled by new recruits coming in at the entry level. That doesn’t include all the promotions, transfers and acting positions that Phoenix will also have to adjust when implementing raises back to 2014.

Public servants are now retiring without knowing for certain what their retirement incomes will be. Pension data depends on salary and Phoenix data is not always accurate or up to date. Public servants have not received annual statements on their pensions and benefits since Phoenix went live in 2016 – the last one dated 2014.

Executives who have retired over the past four years – as with rank and file employees – will also have to their pension payments adjusted. That has become nerve-wracking for recent retirees because they no longer have access to Phoenix and are often baffled when receiving lump sum payments as what they are for and if the amounts are correct.

But executives aren’t not the only employees waiting to be processed by Phoenix.

The government still has a several contracts with smaller unions to settle. It recently signed a contract with the Public Service Alliance of Canada for 8,200 border services offices, triggering a 150-day countdown for the government to implement all salary increases and retroactive payments.

The deluge of collective agreements has thrown a curve at the troubled Phoenix system over the past two years because the system didn’t have the retroactive functions to handle payment adjustments going back to 2014. New contracts have forced compensation advisers to manually process pay adjustments with data retrieved from an older system that most have never worked on.

The government, however, is racing to eliminate the backlog and stabilize Phoenix faster than the five year projection the government’s chief financial officer estimated – at a cost of $3. 5 billion. More than half of the 300,000 public servants paid by Phoenix have some kind of outstanding pay issue.

PSPC’s latest Phoenix update in June showed the pile of transactions sitting in the pay centre’s queue had declined for the fifth month in a row by 13,000 files, inching the backlog down to 577,000 files.